DOW JONES INDUSTRIAL AVG INDEX- A TECHNICAL UPDATE-18-1-2016

DOW JONES INDUSTRIAL AVG INDEX-

CLOSED AT 15988.08 ON  15-1-2016.

                                                                           

SUPPORT:-15855.12/15842.11/15370.33/15340.69/14760/14719.43/14551.27/14444.03.

 RESISTANCE:-16333.78/16593.51/16933.43/17116.73/17210.43/17405.40/17425.03.

(Figures in bold are important)

It fell down by more than 1700 points in last thirteen trading days and in the process it has broken its entire short and long term moving averages decisively which speaks of gross weakness in it. I gave fair indication about its weak undertone in my last post of 14-12-2015 when it was at 17265.21. It has also decisively broken its long term rising trend line few days back which was drawn from the bottom of 6469.95 and now is at 17000(it keeps on rising every day) is a very bad sign.  Please note that it’s most important benchmark points for the entire year of 2016 are 17425.03 & 15370.33 and  it is way below the first point and holding on the second one. It has good support in the range of 15500--15340 but looking at the overall technical setup  it seems that it is a matter of time only but the said range will be taken out for sure and sustained break below 15340 mark may accelerate the fall ,so watch out. However in between relief rallies cannot be ruled out. It will show some strength if it moves and sustain above 17425.03 levels which may please be noted, chances of which looks bleak as of now. It is in down trend for sure therefore it is very important to mention here that the threshold level for it entering the bear market is at 14681 and sustained break below this mark may trigger bigger fall this may be kept in mind. Technically it is on a very weak footing therefore it is suggested to avoid long call till it shows some visible strength.   

REMARKS: - The trend is down and in view of the above observation it seems that further fall is ahead therefore long call should be avoided but if initiated should be handled with extreme caution.

Kindly note that make your cost your stop loss in favorable  trade and then trail it as the price move up/down to gain maximum profit and avoid losses. Use support and resistance levels as entry, exit, target and trailing stop loss points. DO NOT TRADE WITHOUT STOP LOSS.

Disclaimer:-The view expressed here are solely of the author and he is not at all responsible in any way for the outcome of the trade you enter based on the above view.

Note: Price stated here is of spot market.

Contact me for strategic guidance to enter and exit the trade.